The Ukrainian Wind Energy Association (UWEA) participated in the conference “Decentralized Generation in Ukraine 2.0: Strengthening the Resilience of the Power System Together,” organized by NPC Ukrenergo and dedicated to the development of new generation capacity and attracting investment into Ukraine’s power sector.
The conference brought together representatives of government authorities, Members of Parliament, energy companies, international financial institutions, banks, and the expert community. Participants discussed the current needs of Ukraine’s power system, investment support mechanisms, the terms of the Competition for the construction of new generation capacity, technical requirements for projects, and prospects for the development of the energy sector.
The discussion focused on the recently announced Competition for the construction of new generation capacity, which provides for the commissioning of more than 1.5 GW of new flexible generation in seven regions of Ukraine and the city of Kyiv. It is expected that by the end of this year the winners will be determined and the relevant contracts will be signed, after which project implementation will begin.
The tender for the construction of generating capacity provides for:
- the connection of +1,505 MW of entirely new generation facilities in Kharkiv, Sumy, Poltava, Dnipropetrovsk, Odesa, Chernihiv, and Kyiv regions, as well as the city of Kyiv;
- the minimum capacity of each new generation facility must be 10 MW;
- all new generation facilities must have a second level of protection;
- incentives for investors through the payment by NPC Ukrenergo of a unilateral market premium for operation during peak load hours of the power system (covering the possible difference between the current electricity price and the bid price, capped at no more than EUR 0.2792/kWh).
“Despite the rather long construction period, we expect that a significant part of the new generation capacity will appear in Ukraine’s power system much earlier – by the end of 2027… Thanks to the Competition, we will do everything possible to ensure that all this capacity starts operating as quickly as possible to strengthen the resilience of the power system, expand its balancing capabilities, and meet consumer demand in the regions experiencing the most severe power shortages,” said Vitalii Zaichenko, Chairman of the Board of NPC Ukrenergo.
During the conference, particular attention was paid to the financial sustainability of the new investor support model.
“We understand investors’ concerns given the previous experience with debts under the ‘green’ tariff. At the same time, over the past several years, the transmission tariff has fully taken into account the financial burden on NPC Ukrenergo related to the fulfilment of its public service obligations. This has made it possible not only to stop the accumulation of debt but also to reduce it by almost UAH 9.2 billion (including VAT) over the past year and a half,” said Yurii Vlasenko, Chairman of NEURC. He also emphasized that establishing transparent, clear, and predictable rules is an important prerequisite for attracting investment in new generation capacity and strengthening Ukraine’s energy resilience.
Ukrainian Wind Energy Association welcomes the open dialogue between the government, the transmission system operator, the regulator, financial institutions, and businesses on the development of new generation capacity. The Association believes that creating predictable conditions for investors, developing modern generation, and implementing market-based support mechanisms are important steps towards strengthening energy security, increasing the resilience of Ukraine’s power system, and further developing renewable energy.
